Navigating Parental Consent for Medicaid

It’s the end of an Individualized Education Program (IEP) meeting, and stakeholders have agreed upon related services prescribed to your student. Before the meeting can conclude and the IEP document is finalized for signature, one last form needs to be addressed: parental consent to bill Medicaid. Outside of service logging, this conversation has the largest impact on Medicaid revenue for a school district.

As your district forms policies and procedures around best practices to obtain parental consent, here are some key areas to consider. Understanding the history and general regulations around consent will also help guide best practices.¹

Jump to a section:

• Medicaid Billing in Schools and Parental Consent: A Very Brief History
• Parental Consent: Requirements and Regulations
• Parental Consent Best Practices
• Is your district’s parental consent form designed for Medicaid billing expansion?
• When should your staff ask for consent in the IEP process?
• My district is in a state that allows billing beyond the IEP and 504. When should we ask for consent for non-IEP students?
• Who should ask for Medicaid consent?
• What are the common questions parents ask and how can we best address those questions?
• Why should I ask all parents for consent to bill Medicaid?
• Where should my district store parental consent information?
• What is the best way to annually notify parents of the continuation of parental consent?

Medicaid Billing in Schools and Parental Consent: A Very Brief History

In 1974, the Family Educational Rights and Privacy Act (FERPA) gave parents the right to protect their child’s personally identifiable information (PII) within a school system.² In 1975, the first iteration of what was eventually known as the Individuals with Disabilities Education Act (IDEA) paved the way for the special education programs we see in schools today and the billing of public health insurance, or Medicaid, to support the delivery of those programs.³

In 1997, an advisory letter by the Department of Education clarified that FERPA regulations on PII include the student’s Medicaid information, creating the requirement for parental consent to access public health insurance information. The reissuance of IDEA in 2004 specified parental consent requirements, explicitly stating that consent must be obtained each time services were implemented.⁴

From 2004 to 2013, school districts maintained a practice of requesting parental consent annually with each IEP. In 2013, new regulations were issued that realigned IDEA with FERPA requirements, which do not have a mandated frequency, to move to a one-time parental consent collection, and annual notice thereafter.⁵

In 2014, the federal government expanded Medicaid billing to services beyond those written into an IEP.⁶ The implementation of this expansion is still ongoing as each state rewrites and submits new Medicaid plans incorporating the new federal regulations into state practice.

Parental Consent: Requirements and Regulations

Current federal regulations stipulate that:

1. Parental consent must be obtained to seek access to public health information, including Medicaid eligibility, and must be obtained to bill public health insurance for services provided.
2. A notification of continued access to public health insurance must be sent annually to the parent.
3. Parents have the right to revoke consent at any time.
4. School districts are obligated to provide services to students through Free and Appropriate Public Education (FAPE), regardless of the parental consent status.⁷

Parental Consent Best Practices

Because parental consent is required to bill Medicaid, it’s critical to assess your district’s process of obtaining parental consent and maintaining proper records. Following best practices and considering future regulations are key to successful compliance management and to bringing crucial funds back into your district.

Best practice should ensure your district not only maximizes consent for services that are billable today, but also plans for billing expansion, if your state has not already implemented billing expansion policies.

Is your district’s parental consent form designed for Medicaid billing expansion?

As states continue to expand Medicaid billing beyond IEP services, you should also update parental consent forms to reflect these options. Massachusetts, a pioneer in the expansion of school-based billing, issued new consent forms, available through this link, that define school health services beyond the IEP and mandated recollection for all students. Since most states are still in the process of updating their state plans to expand billing, current parental consent form templates offered by states often still specify IEP services in the language, making them unusable for any other type of school health billing. Districts should plan revisions to consent forms to reflect all school health services ahead of regulatory updates, to maximize potential revenue increases as state regulations change. ^8,9

When should your staff ask for consent in the IEP process?

Parental consent is best obtained long before the IEP meeting, which can often be contentious as service levels and types are decided. It’s better to discuss parental consent when the parent provides permission to evaluate their child, for two reasons:

1. Most parental consent forms have a single date to mark the start of consent: the signature date. If parental consent is collected prior to the evaluations, the evaluations can be billed.
2. Second, it reduces the risk that disagreements in the IEP meeting will lead to a denial from the parent.

My district is in a state that allows billing for students without an IEP. When should we ask for consent for these students?

504 services, school health services, and mental health services are the most common areas of expansion for Medicaid billing, largely due to entrenched practices of determining medical necessity and creating service plans. Obtaining consent should begin by cross training consent talking points within these departments, and adding parental consent forms to 504, school health, and mental health standard packets.

Massachusetts serves as a useful guide here as well: department of education consent collection and outreach guidance recommends including parental consent forms in

• free and reduced lunch applications,
• start of school year packets, and
• health plan meetings¹⁰.

Who should ask for consent?

The role is less relevant than proper training. Equip personnel tasked with this duty with the proper answers to parents’ frequently asked questions.

What are the common questions parents ask and how can we best address those questions?

State education departments generally put together FAQs that apply to their state programs and reflect federal regulations. Here are some examples from Louisiana and Indiana. Common questions and answers are:

Question: Why am I being asked for consent? How do you know my family is on Medicaid?

Answer: To avoid discrimination, all parents are asked for consent to bill Medicaid.¹¹ An added benefit to this policy is that consent will be viable should the family become Medicaid recipients in the future.

Question: Will this affect my family’s overall Medicaid benefits?

Answer: No. Your personal Medicaid and school-based Medicaid come from distinct pools of funding and do not affect each other.¹² This answer is often distrusted, due to misinformation from advocacy groups, private practitioners, and other stakeholders. Equipping your personnel with regulatory materials that support this answer is beneficial.

Question: If I say no, will my student still receive services?

Answer: Yes, services do not depend on your consent to bill Medicaid.¹³

Why should I ask all parents for consent to bill Medicaid?

First, you avoid potential discrimination or miscommunication. Beyond morality, this protects your district in the face of legal implications. Second, if a student becomes eligible for Medicaid in the future, you already have the consent required to bill Medicaid. This point may become more prominent if your state adopts Free Care, opening up the possibilities to bill Medicaid for students without an IEP who have a Plan of Care.

Where should my district store parental consent information?

This is a very important question because, with the expansion of Medicaid billing beyond IEP service, it’s easier to lose the record of parental consent (which only needs to be obtained once) in the paper shuffle. And once parental consent is obtained, revisiting that conversation runs the risk of a revocation.

Districts often use disparate systems to develop IEPs, 504s, student health plans, service logging, Medicaid billing, student health documentation, and behavioral or mental health documentation. While all systems should be equipped to collect parental consent records, a single source system, which is typically the Student Information System, can feed that information elsewhere as necessary. For example, if parental consent for all health services is collected during a 504 process, this should be fed into the IEP system, so the parental consent conversation can be bypassed.

What is the best method to annually notify parents of the continuation of parental consent?

While parents/guardians are required to be notified annually, there is no stipulation that they sign or physically acknowledge this notice. Notices can be included in back-to-school information packets that are sent to all parents to ensure the notice reaches all required recipients and compliance is maintained.¹⁴

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1 Mays, A., & O’Rourke, L. (2019, December). A Guide to Expanding Medicaid-Funded School Health Services. Retrieved from https://healthyschoolscampaign.org/wp-content/uploads/2019/12/A-Guide-to-Expanding-Medicaid-Funded-School-Health-Services-12-19-19.pdf.

2 Electronic Privacy Information Center. (n.d.). Family Educational Rights and Privacy Act (FERPA). Retrieved May 20, 2020, from https://epic.org/privacy/student/ferpa.

3 U.S. Department of Education. (n.d.). About IDEA. Retrieved May 20, 2020, from https://sites.ed.gov/idea/about-idea.

4 New York State Education Department. (2012, January 18). Parental Consent. Retrieved from http://www.oms.nysed.gov/medicaid/resources/parental_consent.html.

5 U.S. Department of Education. (2017, July 12). Sec. 300.154 (d) (2). Retrieved from https://sites.ed.gov/idea/regs/b/b/300.154/d/2.

6 Mann, C. (2014, December 15). Medicaid Payment for Services Provided without Charge (Free Care). Retrieved from https://www.medicaid.gov/sites/default/files/federal-policy-guidance/downloads/smd-medicaid-payment-for-services-provided-without-charge-free-care.pdf.

7 U.S. Department of Education. (2017, July 12). Sec. 300.154 (d) (2). Retrieved from https://sites.ed.gov/idea/regs/b/b/300.154/d/2.

8 Virginia Department of Education. (n.d.). Medicaid & Schools. Retrieved May 20, 2020, from http://www.doe.virginia.gov/support/health_medical/medicaid/index.shtml.

9 Mittnacht, M. (2013, July 13). Administrative Advisory SPED 2013-1. Retrieved May 20, 2020, from http://www.doe.mass.edu/sped/advisories/13_1.html.

10 Mittnacht, M. (2013, July 13). Administrative Advisory SPED 2013-1. Retrieved May 20, 2020, from http://www.doe.mass.edu/sped/advisories/13_1.html.

11 U.S. Department of Education. (n.d.). Sec. 300.154 (d) (2) (v). Retrieved May 21, 2020, from https://sites.ed.gov/idea/regs/b/b/300.154/d/2/v.

12 Louisiana Department of Education. (n.d.). 2013 Parental Consent to Seek Medicaid Reimbursement_Revised Final.docx. Retrieved May 20, 20202, from https://4.files.edl.io/8612/09/18/19/015629-dc236936-3003-4e59-9f78-81e0e0c764bc.pdf.

13 Indiana Department of Education. (n.d.). Medicaid Parental Consent Form Indiana. Retrieved May 20, 2020, from https://www.doe.in.gov/sites/default/files/specialed/medicaid-parental-consent-form-indiana.pdf.

14 U.S. Department of Education. (2017, July 12). Sec. 300.154 (d) (2). Retrieved from https://sites.ed.gov/idea/regs/b/b/300.154/d/2.